Investment should be made if NPV >0.If company has unlimited funds- NPV > or =0.

Net Present Value =

= the PV of an investment's future net cash flows minus the initial investment.If positive, the investment should be made (unless an even better investment exists), otherwise it should not.- the method that recognizes the time value of money by discounting the after- tax cash flows over the live of a project, given the company's minimum desired rate of return.

A factor which can be used to calculate the present value of a series of annuities. The initial deposit, earning interest at the periodic rate (r), perfectly finances a series of (N) consecutive dollar withdrawals. PVIFA is also a variable used when calculating the present value of an ordinary annuity (is an annuity whose payments are made at the end of each period). PVIFA = [- (1 + r)^-N]/r